Tag Archive: RBA

Market Pushes the Yen Lower, Helped by a Broadly Firmer Greenback

2024-05-07

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2024-05-07

Overview: The dollar is firmer against all the G10 currencies today. The market is somewhat less fearful of intervention and the yen is extending yesterday's losses. It is rivaling the Australian dollar for the weakest of the major currencies after the Reserve Bank of Australia left rates on hold and played down speculation of possibility of a rate hike. Both currencies are off around 0.4% in late European morning turnover. Disappointing German...

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Gold, Oil, and Interest Rates Rise

2024-04-02

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2024-04-02

Overview:  The market put more weight on the rise in the US ISM manufacturing survey than the downward revision to the manufacturing PMI and the unexpected back-to-back decline in construction spending. US rates shot up and lifted the greenback. The Dollar Index made a new high for the year, a little above 105, which had been anticipated by the new lows recorded by the Bannockburn World Currency Index (a GDP-weighted basket of the currencies of...

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Greenback Surges after BOJ Hikes and Ends YCC and RBA Delivers a Dovish Hold

2024-03-19

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2024-03-19

The US dollar is surging today against most of the G10 currencies, and although the intraday momentum is stretched ahead of start of the North American session, there may be little incentive to resist before the end of the FOMC meeting tomorrow.

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Heightened Speculation of a BOJ Move Tomorrow did not Stop the Nikkei from Rallying or Yen from Slipping

2024-03-18

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2024-03-18

Overview: The US dollar is trading with a mostly softer bias against the G10 currencies. The notable exceptions are the Japanese yen and Swiss franc. Ironically, speculation of a Bank of Japan rate hike appears to have increased, while there is a risk that the Swiss National Bank cuts rates this week. The Norwegian krone is the strongest of the major currencies. The central bank meets later this week but is widely expected to stand pat. The...

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Greenback Consolidates Two-Day Surge

2024-02-06

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2024-02-06

Overview: The US dollar is consolidating its the two-day surge since the jobs data at the end of last week. The Reserve Bank of Australia did not rule out additional rate hikes, and although the derivatives markets do not think it is likely, the Australian dollar is the best performer in the G10 today with a small gain. An unexpectedly strong German factory orders report failed to help the euro much and it languished near yesterday's low. Sterling...

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Softer Tokyo CPI Buys BOJ Time while Moody’s Cuts the Outlook for China’s Debt following Fiscal Stimulus and the Continued Property Slump

2023-12-05

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2023-12-05

Overview: Outside of the Australian dollar, which has fallen by around 0.6% following the RBA meeting and the softer final PMI, which may have dragged the New Zealand dollar a lower by around 0.25%, the other G10 currencies trading little changed ahead of the start of the North American session. The eurozone and UK final PMIs were revised higher. Central European currencies lead the emerging market currencies. China reported better than expected...

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Rates and the Dollar Come Back Firmer

2023-12-04

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2023-12-04

Overview: Weekend accounts seemed to try to understand what Fed Chair Powell said by beginning with the large drop in US rates. Yet, most accounts miss the fact that no matter what Powell has said, the market has more often than not reacted as if he were a dove. Rates have come back firmer today, perhaps as some recognized the overshoot. The US two-year yield is up nearly seven basis points after falling 14 before the weekend. The 10-year yield is...

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Yen and Yuan Extend Surge

2023-11-21

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2023-11-21

Overview: The dollar remains offered and our ideas about it stalling as central banks push against the timing and extent of the easing the market is anticipating are being challenged. The Governor of the Reserve Bank of Australia and the Bank of England both warned higher rates may still be needed. Still, the momentum may be slowing. Meanwhile, the short squeeze continues to lift the Japanese yen, which is trading at its best level in two months....

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The Dollar’s Recovery has been Extended, but it may Give North American Operators a Better Selling Opportunity

2023-11-07

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2023-11-07

Overview: The dollar's sell-off last week was extreme and it recovered yesterday and through the European session today. The Australian dollar has been hit the hardest. It is off more than 1% today after the RBA lifted the cash rate by 25 bp (to 4.35%). Still, the US dollar's gains have stretched intraday momentum indicators, suggesting the upside correction may be nearly over. The greenback's moves appear to have been driven by interest rate...

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The Dollar Remains Mostly Softer but Near-Term Consolidation is Likely

2023-11-06

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2023-11-06

Overview: The US dollar, which was sold last week after the FOMC and soft employment report, remains on the defensive today. The Antipodean currencies and yen are struggling, but the other G10 currencies are firm. The dollar is also lower against most emerging market currencies. Still, given the magnitude of the dollar's pullback, we suspect some consolidation is likely.Asia Pacific equities rallied, helped by the sharp gains in the US before the...

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Dollar Stabilizes After Extending Gains

2023-10-03

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2023-10-03

Overview: The dollar's gains were initially extended before a consolidative tone emerged. The euro has been sold to $1.0460 and has returned to almost $1.05. Sterling fell to nearly $1.2060 and has recovered though has stopped short of $1.2100. The dollar edged closed to JPY150 but stalled near JPY149.95 and has held above JPY149.65. The Australian dollar near $0.6300 and the greenback rose to CAD1.3725. Benchmark 10-year yields are firm, though...

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RBA Holds Fire, Greenback Rebounds

2023-08-01

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2023-08-01

Overview: The dollar has come back bid. It is rising against all the major currencies today. The Reserve Bank of Australia left rates steady and the poor Chinese Caixin PMI is weighing on the Australian dollar, which is off about 1.25% today. Sterling is the best G10 performer, off about 0.1%. Perhaps, the BOE's meeting on Thursday is helping to deflect some of the selling pressure. Emerging market currencies are also nearly all lower, led by the...

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Sobering PMI Readings Sap Risk Appetites

2023-07-05

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2023-07-05

Overview: As US markets prepare to re-open from yesterday's holiday, the dollar is trading mostly higher, though the euro and yen are steady to slightly firmer. Narrow ranges are prevailing. The Canadian and Australian dollars are exceptions and are off about 0.3%. Emerging market currencies are mostly lower, including Russia, China, South Africa, and Turkey. Final service and composite PMIs were mostly revised lower in Japan, Australia, and the...

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RBA Surprises with a Quarter-Point Hike and German Factory Orders Disappoint

2023-06-06

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2023-06-06

Overview: The Reserve Bank of Australia surprised many with a quarter-point hike and German factory orders unexpectedly fell. Reports suggest that China has asked banks to cut deposit rates. The next result is the Australian dollar is the strongest currency in the G10 and helped lift the Canadian dollar ahead of the Bank of Canada meeting tomorrow. Australian stocks sold off (~1.2%) while large markets outside of China rose in the region. Europe's...

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Dollar Gains Extended, Oil Steadies at Higher Levels after Saudi’s Cut, US Bill Deluge Begins Today

2023-06-05

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2023-06-05

Overview:  The US dollar has extended its post-employment gains today, helped by firmer rates and several countries seeing downward revisions from the preliminary May PMI. The greenback is trading with a firmer bias against all the G10 currencies and most of the emerging market currencies, including Turkey, India, and China. July WTI gapped higher after the Saudi Arabia announced a voluntary and unilateral cut of one million barrels a day in output...

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Biden to Go to G7 Summit with Debt Ceiling Unresolved

2023-05-16

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2023-05-16

Overview:  The US debt ceiling talks resume at the White House today but a deal is unlikely to be announced. President Biden will attend the G7 summit in Hiroshima with the debt ceiling still looming. The dollar is mostly softer as last week's gains are pared. The Swiss franc and Japanese are the strongest in the G10. The Thai baht and South African rand, among the market's favorites yesterday are seeing those gains retraced. The JP Morgan Emerging...

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The Greenback Remains Heavy Ahead of the Employment Report

2023-05-05

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2023-05-05

Overview: The US dollar is weaker against all the G10 currencies today but the Swiss franc. The backdrop seems fragile even though a few regional bank shares have done better in after-hours trading and Apple's earnings were received well by the markets. Due to seasonal factors and other considerations, many are warning about a US jobs report, even though ADP's estimate surprised to the upside earlier this week. Equities were mixed in the Asia...

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RBA Surprises with a Quarter-Point Hike

2023-05-02

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2023-05-02

Overview: A combination of a surprisingly strong prices paid component to the US manufacturing PMI, corporate supply, and US debt woes spurred an almost 15 bp spike in the US 10-year yield and 13 bp jump in the two-year yield. The rise in US rates appeared to lend the dollar support. The greenback's gains have been extended today, but a surprise hike by the Reserve Bank of Australia is seeing the Australian dollar (and New Zealand dollar) traded...

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Dollar Pares Gains but is Poised to Recover in North America

2023-04-18

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2023-04-18

Overview:  A rise in US yields, with the two-year Treasury closing yesterday at its best level in more than three weeks help fuel follow-through dollar buying yesterday after an upside reversal at the end of last week. Key levels were approached, like $1.09 in the euro, $1.2345 in sterling, and JPY135 held, and the dollar has consolidated in Asia and Europe. The euro and sterling recouped around half of the losses seen from the Friday's high to...

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